Irish health system is not a ‘basket case’

Brian Turner | 05 Nov 2018 | 0 Comment(s)

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Brian Tuner provides a comparison of international health systems and finds that while Ireland’s funding model is unusual, it is facing the same challenges as other countries

reland’s health system contains a complex mixture of public and private funding and provision of services and the overlaps between these have sometimes led to criticism of the system as being inequitable. However, similar overlaps are evident in other systems, albeit not to the same extent in many cases and similar concerns have been expressed in other countries about the interactions between the public and private elements of the system.

Comparing health systems internationally is fraught with difficulty, as systems have developed over long periods of time with distinct features becoming embedded. However, the UK and Australia have systems with broadly similar funding mechanisms to Ireland, in that they are all primarily tax funded, with contributions from private health insurance and out-of-pocket payments. (In each case, contributions from charitable donations provide a relatively small proportion of funding.)

By contrast, the German and Belgian health systems are predominantly funded through social health insurance, whereby employers and employees contribute a proportion of the employee’s earnings into sickness funds, with the State subsidising contributions in some cases. Again, private health insurance and out-of-pocket payments also form part of the health funding landscape.

Entitlements to health services are more clearly defined in these other four countries (albeit with varying degrees of cost-sharing) than they are in Ireland, with possession of a medical card here determining the degree of entitlements and/or charges to a large extent. In particular, Ireland is unusual in having a large proportion of the population subject to significant out-of-pocket payments for GP services, albeit this proportion has been reduced in recent years with the expansion of eligibility for GP visit cards.

In terms of health spending per capita, Ireland currently spends a similar amount to Germany and more than the other three countries.  However, Ireland only caught up with Australia, Belgium and Germany in the mid-2000s, having consistently under-spent relative to those countries in the 1970s, 1980s and 1990s. Compared with the UK, we spent broadly similar amounts until the mid-1990s; since then we have consistently spent more.

One issue that should be taken into account in this regard is that Ireland has a relatively younger population compared with the other four countries. In 2016, 13.2 per cent of Ireland’s population was aged over-65, compared with 14.3 per cent in Australia, 17.9 per cent in the UK, 18.2 per cent in Belgium and 21.1 per cent in Germany. Research has shown that average medical expenses rise with age, so we have an advantage in this regard, although demographic projections suggest that this will be eroded in the coming years.

In all five countries, private health insurance operates alongside the statutory healthcare system. However, the nature of this insurance varies between supplementary (providing benefits over and above those provided by the statutory system, such as faster access, greater choice of provider and/or superior accommodation), complementary (providing coverage for services not available under the statutory system and/or for co-payments payable for services that are provided by the statutory system) and substitutive (substituting for the statutory system). In Ireland, the UK, Australia and Belgium, private health insurance is primarily supplementary, with elements of complementary in the first two countries, while in Germany it is primarily substitutive.

In Ireland and Australia, private patients may be treated in private or public hospitals and many public hospital consultants have private practice rights (although, interestingly, many of these do not avail of those rights in Australia).

In the UK, there is less treatment of private patients in public hospitals, although recent legislative developments have encouraged this to a greater extent (the opposite of the proposed removal of private practice from public hospitals in Ireland envisaged under the Sláintecare proposals).

In Belgium and Germany, there is more of a contractual relationship, whereby public and private purchasers contract with the same providers.

In each of the countries, concerns have been raised over the equity of having a mixed public/private system, where take-up of private health insurance is higher among those with higher incomes and where such insurance confers faster access to treatment in some cases. There are also concerns about Government subsidisation of private health insurance in both Ireland and Australia. Furthermore, in a number of these countries, significant premium increases have led to concerns about the sustainability of private health insurance. Interestingly in this regard, having risen rapidly during the recession, premiums in Ireland have actually begun to fall back slightly in the last year or so.

Despite a perception that Ireland’s health system is something of a basket case, it appears that our system shares a number of characteristics with other health systems, although it does also have some unusual features. However, it is somewhat consoling that other countries are also grappling with some similar issues.  Perhaps we could learn from their experiences and vice versa.

This article is based on a report, entitled The Irish Healthcare System: An Historic and Comparative Review, published by The Health Insurance Authority, to which the author contributed the comparative review.

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